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Point in time view as at 01/04/2013.

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Business to be conducted in a prudent mannerU.K.

(2)To satisfy the condition in sub-paragraph (1), C must in particular have appropriate financial and non-financial resources.

(3)To have appropriate financial resources C must satisfy the following conditions—

(a)C’s assets must be appropriate given C’s liabilities, and

(b)the liquidity of C’s resources must be appropriate given C’s liabilities and when they fall due or may fall due.

(4)To have appropriate non-financial resources C must satisfy the following conditions—

(a)C must be willing and able to value C’s assets and liabilities appropriately,

(b)C must have resources to identify, monitor, measure and take action to remove or reduce risks to the safety and soundness of C,

(c)C must have resources to identify, monitor, measure and take action to remove or reduce risks to the accuracy of C’s valuation of C’s assets and liabilities,

(d)the effectiveness with which C’s business is managed must meet a reasonable standard of effectiveness, and

(e)C’s non-financial resources must be sufficient to enable C to comply with—

(i)requirements imposed or likely to be imposed on C by the PRA in the exercise of its functions, and

(ii)any other requirement in relation to whose contravention the PRA would be the appropriate regulator for the purpose of any provision of Part 14 of this Act.

(5)The matters which are relevant in determining whether C satisfies the condition in sub-paragraph (1) or (2) include—

(a)the nature (including the complexity) of the regulated activities that C carries on or seeks to carry on;

(b)the nature and scale of the business carried on or to be carried on by C;

(c)the risks to the continuity of the services provided by, or to be provided by, C;

(d)the effect that the carrying on of the business of effecting or carrying out contracts of insurance by C might be expected to have on the stability of the UK financial system or on those who are or may become C’s policyholders;

(e)the effect that C’s failure or C being closed to new business might be expected to have on the stability of the UK financial system or on those who are or may become C’s policyholders;

(f)C’s membership of a group and any effect which that membership may have.

(6)C is “closed to new business” for the purposes of this paragraph if C has ceased to effect contracts of insurance or has substantially reduced the number of such contracts which C effects.]

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